Blogging about all sorts of things--governance in higher education, in businesses, and in law firms; bankruptcy ethics; popular culture & the law; Enron & other corporate fiascos; professional responsibility generally; movies; ballroom dancing; and anything else that gets my attention.

Sunday, October 31, 2010

It's a few days until Election Day, and I'm already cranky: every time our home phone rings (a sure sign that the caller doesn't know us--our friends use our cell phone numbers to reach us), I've been answering it with "if this is a political call, please hang up now." I'm tired of being asked for whom I've voted.

But I'm far more tired of hearing both political parties call each other names. I'm not "stupid" if I vote for someone you detest. You're not stupid for voting for someone I detest. We should realize that smart, goodhearted people can disagree without being disagreeable.

Demonizing people for their thoughts is a bad way to go, and it betrays the foundations on which our country was founded. Cut it out.

Saturday, October 30, 2010

I keep trying to fix a login problem at The New Yorker's website. The site now keeps putting me into infinite loop. I love the articles in this magazine, but I cannot abide the lack of useful help that the website provides when there are login problems.

I've read the piece (of course), and I think that Bernie and David make some really important points about how BigLaw firms are likely to evolve.

Here's the abstract:

This Article addresses the deceptively simple questions why, up to the onset of the recent recession, law firms continued to grow at the rapid rate and in the unusual configuration that they have exhibited for over 40 years; and whether lawyers, clients, law students and law schools should expect familiar trends to reassert themselves as the economy improves. We show that the copious academic theorizing addressing these questions (focusing on such notions as diversification, asset specificity, “tournament” theory, and reputational and agency-cost concerns at the level of the firm as a whole) has proved ineffective at explaining or predicting actual events to date, and thus offers little guidance for the future.

We suggest two perspectives that appear more consistent with the available empirical evidence, and thus more likely to predict future trends. The first perspective shows that the core members of a professional service firm can mutually increase the value of one another’s connections and reputation in a manner that can increase the mutual gain with the size of the core group, and thus stimulate firm growth and help bind the firm together – though only somewhat loosely – as it grows. This perspective is new to the literature on law-firm economics, and helps explain why law firms have long continued to get larger despite ordinary diseconomies of scale, though with a certain brittleness reflected in the lateral mobility common in this day and age. The second perspective brings long-established economic principles concerning technological innovation and transaction costs to bear in the context of the elite law firm, where they have been largely overlooked in the commentary to date. We argue that reductions in particular transaction costs and in the cost of certain key inputs are helpful in explaining a number of the trends in the staffing and pricing of legal services documented in recent years.

We apply these perspectives to derive a range of predictions for law firms and law schools in the years to come. We conclude that, despite rumors of the “Death of Big Law,” the large firm is here to stay, but in an evolving configuration with profound implications for practicing and aspiring lawyers, as well as the law schools that prepare them for the increasingly competitive and increasingly global markets for their services.

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